A Spotlight on Insolvency & Restructuring

Solomon Harris was founded in 1998 by Managing Partner Sophia Harris. With offices in central George Town, the capital of the Cayman Islands, and Zurich, Switzerland, the firm offers cost effective legal advice to both local and international clients wishing to do business in or from the Cayman Islands. We got in touch with Laura Hatfield, the Partner that leads the insolvency, restructuring and litigation team at Solomon Harris, who told us about the services she provides as well as her experience of the myriad changes taking place across the legal landscape.

This a thrilling time to be practising law, as the delivery and structuring of the legal services is being revolutionised by technology and globalisation. This brings challenges but mostly fantastic opportunities to spread the Solomon Harris brand and communicate our approach to providing legal services far more widely than was previously possible.

As for our region, practising law in the Cayman Islands is an opportunity to interact with multiple jurisdictions in a way that is very fulfilling. As a pre-eminent offshore financial and professional services jurisdiction, the Cayman Islands attracts people and companies from all over the world to its products and shores. As advisors to such clients, Solomon Harris lawyers are adept at finding solutions that work across borders, cultures and legal systems.

My team works predominantly on issues arising from distressed Cayman Islands mutual fund situations ‎but also provides legal services to commercial clients who need litigation and dispute resolution assistance. We have acted on every aspect of these types of matters, including advising distressed asset purchasers on acquisition and restructuring. Solomon Harris is a full service law firm but has been particularly well recognised in the fields of business relocation and restructuring, captive insurance‎ structures, mutual fund start-ups, insolvency litigation and asset tracing.

More recently, Solomon Harris has seen a return to what we refer to as ‘business as usual’ with lower insolvency levels resulting from the uptick in global economic performance. With approximately 10,000 companies‎ registered in the Cayman Islands, there will always be insolvencies but now they arise from the usual business lifecycles and not the cataclysmic events of the recession. Having said that, there are a number of areas of concern that could create situations that lead to more insolvencies, such as the decline in Chinese economic performance. In addition, the increase in distressed debt investors purchasing the remaining post-recession liquid and underperforming assets may drive an increase in insolvencies as they seek to realise value from their purchase on the basis of radically different dynamics to those of the seller of the assets.

Furthermore, we have seen a trend in banks selling off non-core bad debt books to private equity groups who are then prioritising the firms that they can realise assets from first, leaving those businesses further down the list in a vulnerable position.

Having been an adviser on both sides of the creditor/debtor fence‎, Solomon Harris understands the business dynamics and commercial realities, as well as the legal options of both the business that is facing challenges and those trying to extract payment from that business. We can help business leaders of any business that has economic issues devise a survival strategy using those tools we have acquired from hands on experience of working for past clients involved from all sides of the situation.

In our experience, nothing favorably impresses creditors and investors more than a management team that is able to get ahead of a problem and is ready‎ to put forward solutions and discuss them with stakeholders in an open and transparent way. The lawyers in our firm don’t just have legal knowledge and know-how but are recognised by peers and industry guides as experts. Tapping into our expertise, and letting it be known that they have done so, will enable senior management to put together a sound strategy to address challenges and, more importantly, sell that strategy to their creditors and investors as credible and appropriate.

Above all, Solomon Harris distinguishes itself from competitors through its ability to nimbly craft client specific legal advice. Solomon Harris lawyers are not required to fit round shaped client issues into the square hole of inflexible precedents and rigid policies‎. In addition, Solomon Harris has no affiliated fiduciary services provider and therefore avoids any issue where the right advice for the client might adversely impact some aspect of a firm’s associated business.